Many owners believe that they have to be able to prove that their boat is EU-taxed in the event of a customs or police check. Owners of older or second-hand boats in particular regularly feel uneasy about this. Especially if there are no invoices or other receipts left to prove that VAT was once paid correctly.
Some potential buyers are even put off buying a used boat if the seller is unable to provide proof of purchase. But is this really a reason not to buy an otherwise perfect boat?
What can you do if there are no more invoices? And why is it no longer possible to invoke the fact that a ship was built before 1985 in the case of much older ships, meaning that there is supposedly no longer any obligation to provide evidence - keyword: Broom Directive? And finally: What happens if the ship has left German or even EU waters? How long are you allowed to sail far away - or even just in the Mediterranean, for example from Greece to Turkey - without getting into trouble with the tax certificate on your return?
Anyone looking for reliable answers to these and many other questions on the internet rarely comes across truly accurate information. On the contrary, there are a lot of half-truths circulating on the web, in social media, but also on the pavements or at the counters of club bars.
Specialising in recreational craft law, among other things Lawyer Benyamin H. K. Tanis from the Kiel law firm Tanis | von der Mosel reports that he is confronted almost daily with enquiries from unsure boat owners or buyers. After close consultation with several European authorities, he has compiled the most important facts on the most pressing questions in connection with the taxation of recreational boats on the following pages.
Every water sports enthusiast should know what this is all about by now: Somehow, every ship owner supposedly has to be able to prove whether their ship is properly taxed. This refers to "value added tax", or more precisely "sales tax" or "import sales tax". Especially when buying and selling used ships, this myth of taxation leads to great uncertainty for all parties involved. But what is it really about?
The most important thing first: For most of all privately traded ships in the EU, the issue is in fact irrelevant!
For boats that were built in the EU, have demonstrably never left the territory of the EU, or at least not for more than 3 years, and are sold from private to private, you do not need any further documentary evidence, such as the original invoice from the first buyer or similar. The current purchase contract with proof of payment (bank statement) together with some mooring and maintenance invoices from the last few years (issued in the EU) should always be sufficient as proof to the customs authorities. It may be advantageous to translate the documents into English so that customs officers in the Mediterranean can read them. That's all you need!
Even the term "EU VAT" is misleading here.
According to Directive 2006/112/EC on the common system of value added tax in the EU, only traders (economic operators according to Art. 9 of the Directive) are taxable persons. They collect the tax on their goods and services and pay it to the state. This means that no state in the EU can levy VAT on private individuals (especially not retrospectively). A significant exception is the so-called import sales tax. This is levied by the respective customs authorities of a country when goods are imported into the EU from third countries (non-EU).
How can I prove that the vessel has never travelled outside EU waters for more than three years?
In principle, you do not have to prove this, as all ships (goods) in the EU are presumed to be Union goods (Art. 153 I UCC). This means that if the inspecting customs authority has no concrete reason to assume that your ship has lost its Union character, then the legal presumption in the entire EU is in your favour. If necessary, the stay in EU waters can be proven, e.g. by means of berth or maintenance invoices with the corresponding date.
And when does customs have reason to assume that my ship has lost its Union character?
This can always be assumed if you are travelling at sea close to the respective sea customs border (EU external border or 12-mile zone). In fact, the customs authorities in the Mediterranean countries often carry out checks close to the EU's external borders. However, they do not check the VAT, but whether your ship is a Union product.
What does that mean again, "Union goods"?
Ships are goods that can be traded in the EU. In principle, goods may only be traded in the EU free of duties (customs duties) if they are so-called "Union goods" (Art. 5 No. 23 UCC). In simple terms, Union goods are all ships that have been completely manufactured in the EU. Non-EU goods are ships that have been manufactured outside the EU or have lost their status as Union goods due to an absence of more than three years from the EU.
And what is the significance of the original invoice?
With an original invoice (with VAT shown and proof of payment) you can prove the Union status of the ship, regardless of the place of manufacture. Nevertheless, the same applies here as for the loss of Union status.
What certificates do I need for ships that were not built in the EU?
Ships built outside the EU are also presumed to be Union goods (Art. 153 I UCC), provided that the ships are located in the territory of the Union. Here, too, you only need to provide evidence of the purchase and payment of the ship within the EU and, if necessary, provide information on the shipping area of the ship in order to counter the allegation of loss of status as Union goods due to absence from EU waters for more than three years. An accurately kept logbook can also be helpful here.
How can I prove the Union character of my vessel if I have actually left EU waters?
Before leaving EU waters, you can use the information sheet INF3 or the so-called simplified certificate of identity for this purpose. Both certificates are paper-based in the EU. This means that you must physically present your ship at the nearest customs office (presentation), bring the completed application form with you and submit the above-mentioned documents. The customs office will then certify that your ship was Union goods at the time of presentation. Unfortunately, completing the INF3 is hardly feasible for the layperson and many customs offices refuse to issue this information sheet if you cannot specify the actual destination (with an address in a third country) of the export. The simplified certificate of identity is more suitable. This can be issued by any German customs office, provided the ship is physically presented there and the required documents are submitted. This type of certificate is less common in other EU countries. Here it is advisable to ask for a subsequently issued T2L freight document. The documents described above must be presented in order to obtain both documents.
Can I simply apply for an official confirmation of the Union goods status of my pleasure craft prophylactically without wanting to leave EU waters with my vessel?
Unfortunately, this is not possible. Although we have already spoken to several EU customs authorities many times about the need for such proof, the legal situation here is clear: apart from the simplified certificate of identity (which is only issued by German customs for goods in Germany and for re-entry into Germany), all official EU documents require the indication of a place of export (with address) in a third country.
Are ships from Great Britain returned goods if I buy them there and bring them back to the EU?
No. With the UK's withdrawal from the EU, all ships of British owners located there have become third-country goods and have lost their status as Union goods. These ships would only be considered returned goods if EU citizens had exported the goods to the UK, but not if EU citizens acquire a ship in a non-EU country from a non-EU citizen.
What is the so-called intra-Community acquisition?
If you buy a new boat from a dealer in France and then bring it to Germany to use it here, the purchase may be exempt from VAT in France. However, this does not mean that you do not have to pay the tax. After the ship arrives in Germany, the owner is obliged to report to the relevant tax office with the purchase invoice in order to pay the tax here. As an exception, the tax debtor is not the seller but the buyer.
2 tips at the end:
1. it is always advisable to have a prepared package of documents ready on board with the purchase contract, proof of payment and the ship's whereabouts history.
2. if you are travelling in another EU country, it makes sense to have a certified translation of these documents so that customs officers in other languages can read everything.
For further questions please contact us: Tel. 0431 389 88 222, info@ra-tanis.de, www.ra-tanis.de
You will find much more useful information for boat buyers in theYACHT guides:
